Industry 4.0 Means Smart Factory, Revolution in Industry

Industry 4.0 = Smart Factory

First came steam and the first machines that mechanized some of the work our ancestors did. Next was electricity, the assembly line and the birth of mass production. The third era of industry came about with the advent of computers and the beginnings of automation, when robots and machines began to replace human workers on those assembly lines.

And now we enter Industry 4.0, in which computers and automation will come together in an entirely new way, with robotics connected remotely to computer systems equipped with machine learning algorithms that can learn and control the robotics with very little input from human operators.
Industry 4.0 introduces what has been called the “smart factory,” in which cyber-physical systems monitor the physical processes of the factory and make decentralized decisions. The physical systems become Internet of Things, communicating and cooperating both with each other and with humans in real time via the wireless web.
For a factory or system to be considered Industry 4.0, it must include:
Interoperability — machines, devices, sensors and people that connect and communicate with one another.
Information transparency — the systems create a virtual copy of the physical world through sensor data in order to contextualize information.

Technical assistance — both the ability of the systems to support humans in making decisions and solving problems and the ability to assist humans with tasks that are too difficult or unsafe for humans.
Decentralized decision-making — the ability of cyber-physical systems to make simple decisions on their own and become as autonomous as possible.
Additionally, there is a systemic lack of experience and manpower to create and implement these systems — not to mention a general reluctance from stakeholders and investors to invest heavily in new technologies.
But the benefits of an Industry 4.0 model could outweigh the concerns for many production facilities. In very dangerous working environments, the health and safety of human workers could be improved dramatically. Supply chains could be more readily controlled when there is data at every level of the manufacturing and delivery process. Computer control could produce much more reliable and consistent productivity and output. And the results for many businesses could be increased revenues, market share, and profits.
Reports have even suggested that emerging markets like India could benefit tremendously from Industry 4.0 practices, and the city of Cincinnati, Ohio has declared itself an “Industry 4.0 demonstration city” to encourage investment and innovation in the manufacturing sector there.
The question, then, is not if Industry 4.0 is coming, but how quickly. As with big data and other business trends, I suspect that the early adopters will be rewarded for their courage jumping into this new technology, and those who avoid change risk becoming irrelevant and left behind.

Big data.

An African gold mine found ways to capture more data from its sensors. New data showed some unsuspected fluctuations in oxygen levels during leaching, a key process. Fixing this increased yield by 3.7 percent, worth up to $20 million annually.

Advanced analytics.

Stronger analysis can dramatically improve product development. One automaker uses data from its online configurator together with purchasing data to identify options that customers are willing to pay a premium for. With this knowledge, it reduced the options on one model to just 13,000—three orders of magnitude fewer than its competitor, which offered 27,000,000. Development time and production costs fell dramatically; most companies can improve gross margin by 30 percent within 24 months.

Human-machine interfaces.

Logistics company Knapp AG developed a picking technology using augmented reality. Pickers wear a headset that presents vital information on a see-through display, helping them locate items more quickly and precisely. And with both hands free, they can build stronger and more efficient pallets, with fragile items safeguarded. An integrated camera captures serial and lot ID numbers for real-time stock tracking. Error rates are down by 40 percent, among many other benefits.

Digital-to-physical transfer.

Local Motors builds cars almost entirely through 3-D printing, with a design crowd sourced from an online community. It can build a new model from scratch in a year, far less than the industry average of six. Vaux hall and GM, among others, still bend a lot of metal, but also use 3-D printing and rapid prototyping to minimize their time to market.

These changes and many others like them are sure to be far reaching, affecting every corner of the factory and the supply chain. The pace of change, however, will likely be slower than what we’ve seen in the consumer sector, where equipment is changed frequently. The coming of steam power and the rise of robotics resulted in the outright replacement of 80 to 90 percent of industrial equipment. In coming years, we don’t expect anything like that kind of capital investment. Still, the executives surveyed estimate that 40 to 50 percent of today’s machines will need upgrading or replacement.

Industries Be Ready for Big change

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